USL board orders probe into loans to UB Group companies

"Certain pre-existing loans/deposits/advances due to the company and its wholly owned subsidiaries from United Breweries (Holdings) Ltd which were in existence as on March 31, 2013, has been taken into consider atom in the consolidated annual accounts of the company drawn up as of that date."

The Board of United Spirits Ltd , now controlled by Diageo, has ordered a probe into the loans given by United Spirits to UB Group companies as it posted a whopping net loss of Rs 4,488.77 crore for the financial year ended March 31, 2014.

The company had reported net loss of Rs 105.03 crore in the fiscal ended March 31, 2013. USL made provisions of Rs 1,012.75 crore in year ended March 31, 2014 on the account of 'doubtful loans' and exceptional item of Rs 3,235.73 crore on sales of Scottish subsidiary, Whyte and Mackay.

While ordering the probe for a "detailed and expeditious enquiry on doubtful loans", the company said: "The Board has directed the Managing Director to engage independent advisors and specialists as required for the enquiry. "Certain pre-existing loans/deposits/advances due to the company and its wholly owned subsidiaries from United Breweries (Holdings) Ltd which were in existence as on March 31, 2013, has been taken into consider atom in the consolidated annual accounts of the company drawn up as of that date."

Pursuant to a previous resolution passed by the Board on October 11, 2012, such dues (together with interest) aggregating to Rs 1337.40 crore were consolidated into, and recorded as, an unsecured loan by way of an agreement between the company and UBHL," the company said. For the quarter ended March 31, 2014, the company reported standalone net sales of Rs 1,916.95 as against Rs 1,866.18 crore in the corresponding period a year ago. For the quarter ended March 31, 2014, USL's standalone net loss stood at Rs 5380.10 crore as against net profit of Rs 56.02 crore.

The probe comes after UB group chairman Vijay Mallya was declared a wilful defaulter by state-owned United Bank of India. However, Mallya disagreed with the action of the lender and said he would pursue legal action. "We were not given a hearing, we have not appeared before them, we disagree with their action and we shall pursue legal action," Mallya told reporters after the annual general meeting of United Breweries.

World's largest spirits maker Diageo Plc announced on November 9, 2012 that it will acquire 53.4 percent stake in United Spirits for Rs 11,166.5 crore in a multi-structured deal.
 

United Spirits stock price

On August 22, 2014, United Spirits closed at Rs 2279.05, down Rs 111.2, or 4.65 percent. The 52-week high of the share was Rs 2940.55 and the 52-week low was Rs 2226.00.

The latest book value of the company is Rs 89.71 per share. At current value, the price-to-book value of the company was 25.40.

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Trai suggests no extra entry fee for full MNP service

Trai suggests no extra entry fee for full Telecom regulator Trai has suggested that full mobile number portability service should attract no additional entry fee and bank guarantee from MNP operators.MNP service

Telecom regulator Trai has suggested that full mobile number portability service should attract no additional entry fee and bank guarantee from MNP operators.

The Department of Telecom (DoT) had sought Trai's opinion on issues like additional entry fee, bank guarantees and clarification on number of players to be involved in the rollout full MNP service in the country.

With regards to entry fee, Trai said whatever it had suggested in its earlier recommendations should be taken for record, sources said.

Trai had submitted its recommendations on full mobile number portability on September 25, 2013.

The government in June this year granted in-principle approval to full MNP that allows customers to retain numbers even after switching operator or location.

The Telecom Commission will now consider the recent clarifications from Trai and will take a final decision on the matter.

There are two MNP operators in India: Syniverse and MNP Interconnection Telecom Solutions India, which is a joint venture between US-based Telcordia Technologies and Indian enterprise DTC.

The government is trying to achieve full MNP by March 2015.

At present, subscribers are allowed to change their service providers while retaining same number within a circle only.

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Wiping off under-recoveries: What does HPCL plan to do now?

With diesel under recovery at historical low of Rs 0.08 a litre, CNBC-TV18's Sajeet Manghat asked the chairperson of HPCL Nishi Vasudeva what is the plan once the under recovery is completely wiped out?

With diesel under recovery at historical low of Rs 0.08 a litre, CNBC-TV18's Sajeet Manghat asked the chairperson of  HPCL Nishi Vasudeva what is the plan once the under recovery is completely wiped out?

HPCL stock price

On August 22, 2014, Hindustan Petroleum Corporation closed at Rs 474.60, up Rs 6.05, or 1.29 percent. The 52-week high of the share was Rs 488.95 and the 52-week low was Rs 172.35.

The company's trailing 12-month (TTM) EPS was at Rs 95.69 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 4.96. The latest book value of the company is Rs 443.31 per share. At current value, the price-to-book value of the company is 1.07.

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SBI launches savings accounts for children

SBI introduced this products three months after the Reserve Bank issued guidelines allowing minors over 10 years to operate bank savings accounts independently and use facilities such as ATMs and cheque books.

State Bank of India  (SBI) today introduced personalised savings accounts for anyone below 18-year age.

SBI introduced this products three months after the Reserve Bank issued guidelines allowing minors over 10 years to operate bank savings accounts independently and use facilities such as ATMs and cheque books.

"'Pehli Udaan' is a singly operated savings bank account for a minor aged 10 years and above and who can sign uniformly, while 'Pehla Kadam; is a savings bank account for minor of any age operated jointly with his/her parent or guardian," SBI said in a statement.

Specially branded passbook, cheque book have been designed for these products. All the account holders will be given an exclusively designed personalised photo ATM-cum-Debit card, it said.

Other features include internet banking with limited transaction facilities like bill payment, opening of fixed deposit, recurring deposits, etc. with per day transaction limit of Rs 5,000, it said.

Besides, such account holders can facility of mobile banking with limited transaction facilities like bill payment, top-ups with per day transaction limit of Rs 2,000.

Auto sweep with a minimum threshold of Rs 20,000 and in multiple of Rs 1,000 with a minimum of Rs 10,000, it said.

While launching these products SBI Chairperson Arundhati Bhattacharya emphasised the importance of cultivating savings habits from childhood, managing and spending money wisely and also stressed upon the importance of inculcating good spending habits early in life.

SBI stock price

On August 22, 2014, State Bank of India closed at Rs 2515.40, up Rs 27.40, or 1.10 percent. The 52-week high of the share was Rs 2833.85 and the 52-week low was Rs 1455.95.

The company's trailing 12-month (TTM) EPS was at Rs 147.33 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 17.07. The latest book value of the company is Rs 1584.34 per share. At current value, the price-to-book value of the company is 1.59.

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Capital raising made easier: RBI tweaks Basel III bonds

The central bank has halved the maturity of these bonds to 5 years from 10 years earlier.

Raising capital has just got easier for banks with RBI tweaking the bonds issued under the Basel III guidelines. As part of these changes, the central bank has halved the maturity of these bonds to 5 years from 10 years earlier.

It has also allowed banks to either convert these bonds into shares or repay a part of the principal amount if the bank makes losses and thereby its core equity capital falls below the mandated 6.125 percent. The remaining principal amount can be repaid in future once banks have enough capital.

More importantly, bankers say these bonds can now be issued to retail investors as well.

NS Venkatesh, Executive Director, IDBI Bank , said: "The revised guidelines put out by RBI is most welcome. Because what they have done is fine tune the regulations. So that it is more or less now converging to an international standards prescribed for the bond issue and present in the international market. I think definitely the issuer should be able to save at least around 50 to 75 bps on the cost of issuance."

Credit rating agencies, on the other hand, say the changes in Basel norms will reduce the risk in these bonds and improve its rating, although these bonds will continue to be a notch down from corporate credit rating. But rating agencies say the demand for these bonds will increase

Pawan Agrawal, Senior Director, CRISIL Ratings, said: "More banks are likely to issue these bonds and our expectation is that there is an appetite or requirement for 1.3 lakh crore over implementation period of Basel guidelines till March 2019. That requirement will continue to be offset if these instruments are not raised. It will have to met by equity, which is clearly a costlier option."

Bank of India had raised the first set of Basel III bonds in July this year. Now other banks like IDBI Bank are looking to raise similar bonds. Analysts say this will bring down the quantum of capital that banks have to raise through equity as debt will now provide a fill up to meet banks' capital requirements.

IDBI Bank stock price

On September 04, 2014, IDBI Bank closed at Rs 75.20, down Rs 1.85, or 2.4 percent. The 52-week high of the share was Rs 116.50 and the 52-week low was Rs 52.30.

The company's trailing 12-month (TTM) EPS was at Rs 5.73 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 13.12. The latest book value of the company is Rs 147.38 per share. At current value, the price-to-book value of the company is 0.51.

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Tata Comm CFO Sanjay Baweja to resign

In order to facilitate an orderly transition, Baweja will continue serving as the CFO until November 3, 2014.

Global Internet solutions provider  Tata Communications today said its Chief Financial Officer (CFO) Sanjay Baweja will be leaving the organisation to pursue other opportunities.

The firm said it is looking for a replacement to Baweja. In a BSE filing, Tata Communications said: "Sanjay Baweja, CFO, will be leaving the organisation to pursue other opportunities. Tata Communications is currently seeking chief financial officer candidates and intends to complete its search in the near future."

In order to facilitate an orderly transition, Baweja will continue serving as the CFO until November 3, 2014, it added. As CFO, Baweja was responsible for strategic financial management including financial reporting and compliance, treasury and fund management, financial planning and analysis, management assurance, taxation and procurement etc.

Prior to Tata Communications, he served in Emaar MGF Land Limited as Executive President for Corporate Affairs and Chief Risk Officer. He has also worked in several roles across companies like Bharti Airtel , Xerox Modicorp, Digital Equipment and Ballarpur Industries.

"Baweja's exit from the business is on positive terms. The company appreciates the tremendous work ethic and professionalism exhibited by him over the last five years and wishes him nothing but success in his future endeavours," the firm said in the filing.

The USD 3.2 billion Tata Communications owns and operates advanced sub-sea cable network, delivering infrastructure, enterprise solutions and partnerships to carriers and
businesses worldwide.

Tata Comm stock price

On September 04, 2014, Tata Communications closed at Rs 385.25, up Rs 13.20, or 3.55 percent. The 52-week high of the share was Rs 412.00 and the 52-week low was Rs 160.00.

The company's trailing 12-month (TTM) EPS was at Rs 15.31 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 25.16. The latest book value of the company is Rs 276.69 per share. At current value, the price-to-book value of the company is 1.39.

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There should be thrust on coal import now: Ex-CIL chairman

Discussing the reasons for coal shortage, Partha Bhattacharya, Former Chairman, Coal India, said this is kind of a situation can occur if Coal India fails to supply coal or there is lesser import by power stations.

Today at least 25 percent of coal is met through imports.

Partha Bhattacharya

Former Chairman

Coal India

The number of thermal plants left with less than seven days of coal reserves has risen from 52 last week to 56 this week , government data showed on Wednesday. Moreover 29 of them are at super critical levels, which means they have coal reserves of under three days.

Discussing the reasons for coal shortage, Partha Bhattacharya, Former Chairman, Coal India , said this is kind of a situation can occur if Coal India fails to supply coal or there is lesser import by power stations.

Below is the transcript of Partha Bhattacharya's interview with CNBC-TV18's Shereen Bhan.

Q: As a former chairman of Coal India how worried would you be and what are the options before the government?

A: The coal that the power houses source are from various places. One of course is Coal India's supply. Second is they have to do certain amount of import of coal and that has to happen as per the time schedule. Now this kind of a situation can occur either because Coal India fails to supply coal; that could be one reason, but that is not always the only reason. Sometimes as you are aware, this year particularly, there have been growth there has been a production growth and so I am not sure whether Coal India as compared to its commitment under the fuel supply agreement have faltered. It may not be so. Then in that case the situation could be because of lesser imports by the power stations. Today at least 25 percent of coal is met through imports.

Q: If I were to just point out what the power minister said, he said that there has been record production in a single month of nine percent by Coal India but yet were faced with this situation. One argument that is being presented is that we have had poor monsoon, demand has been on the higher side, hydel power has been on the lower side but if you were to look at solutions at this point in time what could those be?

A: Right now the domestic coal production is at its peak and there is not much of headroom available to improve up on that then there should be thrust on imports because in any case imports will happen, so why not import now.

Coal India stock price

On August 22, 2014, Coal India closed at Rs 376.00, up Rs 12.35, or 3.40 percent. The 52-week high of the share was Rs 423.50 and the 52-week low was Rs 240.50.

The company's trailing 12-month (TTM) EPS was at Rs 20.04 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 18.76. The latest book value of the company is Rs 26.04 per share. At current value, the price-to-book value of the company is 14.44.

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IBM bets big on India, excited about 'smart cities' project

The company is also seeing a strong revival in the telecom sector and expects clients to start investing. IBM is also on the lookout for acquisitions to build capabilities.

Rebalancing of workforce is an ongoing exercise

Vanitha Narayanan

MD

IBM, India

Global technology giant IBM is betting big on India. Speaking to CNBC-TV18's Sheeren Bhan, its India MD Vanitha Narayanan said the company is excited about the new government's 'smart cities' project.

The company is also seeing a strong revival in the telecom sector and expects clients to start investing. IBM is also on the lookout for acquisitions to build capabilities.

Below is the transcript of Vanitha Narayanan's interview with CNBC-TV18's Shereen Bhan.

Q: Your take on India…

A: There is a level of confidence about both government actions and also policy actions which are now a bunch of private sector actions to occur. So overall I would say confident mood and whether you look at whether it's smarter cities, growth of small enterprises leveraging new technologies or large private clients who have sort of held investments back in and are now ready to go ahead and commit.

Q: Are you beginning to see that already, are clients now putting money on the table because our sense is that while the mood has changed people are not beginning to make investments just yet?

A: I would say probably you can extend it, but we are also seeing it in smaller areas. So definitely I would say in the last quarter, more positive than we have seen in the prior quarters. Some of the big decisions and some of the big investments, yes, we probably have to see a little more time go by but there is movement in terms of proposals. This is the key transformation, this is the key step change, this is something we need to. So we will step in back and revisit those because they can see that this is now going to be a time to act.

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France, Japan in race for India's bullet train corridor

Japan and France are racing each other for a piece of the Ahmedabad-Mumbai bullet train corridor. Companies from both nations have begun studies for the project. CNBC-TV18's Rituparna Bhuyan gets all the exclusive details.

Japan and France are racing each other for a piece of the Ahmedabad-Mumbai bullet train corridor. Companies from both nations have begun studies for the project. CNBC-TV18's Rituparna Bhuyan gets all the exclusive details.

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Jet announces Rs 500 fare offer on domestic route

The all-inclusive fares starts from Rs 500 excluding statutory taxes and customers will be able to enjoy these substantial discounts across all destinations on the airlines' domestic network, the airline said in a release.

A day after budget carrier SpiceJet  announced fares starting at Rs 499 across its domestic network, Jet Airways  too jumped on the bandwagon rolling out Rs 500 fares for the economy class on its domestic flights for a limited period today.

The all-inclusive fares of the city-headquartered Jet Airways, starts from Rs 500 excluding statutory taxes and customers will be able to enjoy these substantial discounts across all destinations on the airlines' domestic network, the airline said in a release.

The bookings under the offer, however, can be made only in two days, starting tomorrow, the airline said, adding that travel under the offer can only be taken January 16, 2015 onwards.

The offer is valid for travel only on direct flights on the airline's domestic network and does not cover group bookings, it said. SpiceJet, which has been rolling out heavy discounts on its ticket prices, starting January this year, had yesterday claimed to have sold more one lakh ticket in a single day under its Rs 499 special fares scheme.

SpiceJet stock price

On September 02, 2014, SpiceJet closed at Rs 13.09, up Rs 0.45, or 3.56 percent. The 52-week high of the share was Rs 23.05 and the 52-week low was Rs 11.10.

The latest book value of the company is Rs -22.24 per share. At current value, the price-to-book value of the company was -0.59.

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